Australian shares end flat as financials counter energy sector boost
- The S&P/ASX 200 benchmark index held its ground at 8,635.40 points, its lowest closing level since mid-July
Australian shares closed unchanged near four-month lows on Monday, as declines in major banks partially offset strong performances in the energy sector, while investors reassess their position in an uncertain monetary policy environment.
The S&P/ASX 200 benchmark index held its ground at 8,635.40 points, its lowest closing level since mid-July.
Financials edged 0.2% down to close at a near four-month low.
Shares of Commonwealth Bank of Australia lost nearly 1% on the day to finish at a seven-month low.
CBA, the country’s biggest lender, has shed more than 10% since early last week after its lacklustre earnings and warnings of margin pressures weighed on market sentiment.
“With things somewhat up in the air regarding future interest rate moves, positive drivers were few and far between on the ASX today,” said KCM Trade Chief Market Analyst Tim Waterer.
Australian investment bank Macquarie fell 2.3% on trading ex-dividend, and has also lost around 10% since last week on lower-than-expected earnings.
Shares of peers ANZ and Westpac finished the day 0.6% higher each.
“CBA and Macquarie are having a bit of trouble shaking off the moniker of being overvalued, which is hindering the share price. Traders are trying to find better value elsewhere in the market.”
Analysts at Citi remain optimistic about the macro environment for banks, naming ANZ and Westpac as their top picks in the sector.
Elsewhere, discretionary stocks ended up 0.2% after falling as much as 1.3% earlier in the session.
A raft of recent robust economic data prompted a sharp pullback in expectations of interest rate cuts.
Swaps now imply just a 36% probability of a May rate cut, down from 70% last week.
Energy stocks gained 1.1% to their steepest one-day rise in a week.
Shares of Woodside added nearly 1%, with the Australian oil and gas producer poised to sign a US LNG supply deal with Saudi Aramco next week.
New Zealand’s benchmark S&P/NZX 50 index ended 0.3% higher at 13,499.04 points.
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